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Emini Approaching 4,400 and October High

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Trading Update: Monday November 6, 2023

S&P Emini pre-open market analysis

Emini daily chart

  • The Emini is approaching 4,400, and the October highs are the first target for the bulls.
  • The rally from the October 27th low is strong enough to lead to a second leg up. The bulls hope the rally will reach the September 1st high, which is the start of the bear channel that ended at the October low.
  • The bears want the market to form a double-top bear flag with the October 17th high. While this is possible, it is more likely a reversal down will be bought.
  • The bears who sold the pullback from the October 27th selloff are trapped in a losing position. These bears will likely use a pullback to buy back shorts at a lower price, which would reduce their overall loss on the trade.
  • The odds favor a pullback lasting 1-3 bars and for the market to end the 6-bar bull microchannel. There will likely be buyers not far below as both bulls and bears will be interested in buying at a discounted price.
  • Because the market is in trading and still under the most recent October 17th lower high, traders should be prepared for a potential 50% pullback from the October 27th low to the November high.
  • Overall, the market will probably go sideways and pull back for at least 1-3 days.

Emini 5-minute chart and what to expect today

  • Emini is up 9 points in the overnight Globex session.
  • The Overnight Globex market has gone sideways in a tight trading range for the past several hours.
  • Today will probably be a bear trend or a trading range bar on the daily chart. This means that traders should attention to the open of the day, as well as Friday’s low, as both will likely be magnets on the day.
  • As I often say, traders should assume that today will have a lot of trading range price action. This means traders should assume that the market will go sideways on the open. Traders should consider not trading for the first 6-12 bars, unless they are comfortable with limit orders and making quick decisions.
  • Most traders should wait for the opening swing that often begins before the end of the second hour, after the formation of a double top/bottom, or a wedge top/bottom.

Emini intraday market update

  • The Emini is in a triangle, a breakout mode pattern.
  • Because the range has been sideways for over 30 bars, the probability is close to 50% for both the bulls and the bears. This means that traders should wait for the breakout and determine if it is likely to succeed or fail.
  • The odds favor a breakout of the 18-bar range. This means the odds favor the market falling below the bar 9 low or above the bar 1 high.
  • Until there is a clear breakout, there is no breakout. This means that traders must be patient and not be too eager to bet on a breakout.

Friday’s Emini setups

SP500 Emini 5-Min Chart Bull Climax Failed Then HL DB and Bull Trend

Al created the SP500 Emini charts.

Here are reasonable stop entry setups from Friday. I show each buy entry bar with a green arrow and each sell entry bar with a red arrow. Buyers of both the Brooks Trading Course and Encyclopedia of Chart Patterns have access to a near 4-year library of more detailed explanations of swing trade setups (see Online Course/BTC Daily Setups). Encyclopedia members get current daily charts added to Encyclopedia.

My goal with these charts is to present an Always In perspective. If a trader was trying to be Always In or nearly Always In a position all day, and he was not currently in the market, these entries would be logical times for him to enter. These therefore are swing entries.

It is important to understand that most swing setups do not lead to swing trades. As soon as traders are disappointed, many exit. Those who exit prefer to get out with a small profit (scalp), but often have to exit with a small loss.

If the risk is too big for your account, you should wait for trades with less risk or trade an alternative market like the Micro Emini.

EURUSD Forex market trading strategies

EURUSD Forex daily chart

  • The EURUSD formed a strong upside breakout last Friday and closed far above the high of the tight trading range, lasting well over a month.
  • The bulls want the current breakout to form strong follow-through buying that leads to a measured move-up, testing the August 30th high.
  • The bears want to form a strong reversal bar, creating bad follow-through, which would trap the bears.
  • Overall, the recent upside breakout is strong enough to get a second leg up. This means there are probably buyers below for a second leg up. The market may have to test the October 24th breakout point high before the bulls get the second leg up.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Triangle Open Bear Breakout Reversal Up

Al created the SP500 Emini charts.

End of day video review

See the weekly update for a discussion of the price action on the weekly chart and for what to expect going into next week.

Trading Room

Al Brooks and other presenters talk about the detailed Emini price action real-time each day in the BrooksPriceAction.com trading room days. We offer a 2 day free trial.

Charts use Pacific Time

When times are mentioned, it is USA Pacific Time. The Emini day session charts begin at 6:30 am PT and end at 1:15 pm PT which is 15 minutes after the NYSE closes. You can read background information on the market reports on the Market Update page.

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